Where to get independent advice about public sector pensions

Dave Vanian

Registered User
Messages
734
I don't know what this means for the Zurich AVC but if it is the "normal retirement age" for the main scheme then this will generally be 65 for post-2004 public servant entrants. If so, it wouldn't apply in this scenario:


But maybe it has a different AVC-specific meaning?

I'm just not up to speed on the fine print of this particular Zurich Life product so I'm afraid I can't shed any more light. I would generally advise the person to go back to the broker selling it to get this confirmed.

But honestly I have a bad feeling about this. It pays a lot of commission and you won't find out for certain if you qualify for the all-important rebate for 25 years. Debatable as to whether or not the broker will even be around then.

I think I'd insist on getting clarification on the exact T&Cs of the rebate in writing from Zurich Life and save them somewhere carefully.
 

cremeegg

Registered User
Messages
3,509
I would generally advise the person to go back to the broker selling it to get this confirmed.

I dont know Dave, he sounds a bit dodgy to me.
But honestly I have a bad feeling about this.
Me too.
It pays a lot of commission and you won't find out for certain if you qualify for the all-important rebate for 25 years.
Why would you want to do business with these guys. They have invented a charging structure to confuse. I say walk away.
 

chases0102

Registered User
Messages
15
Hi folks, thanks very much for your responses, it’s really appreciated and exactly the type of scrutiny that is perhaps needed. Seems overly complicated and too many questions attached to it, and when that is the case, more often than not it is the customer who loses out if the terms are suitably vague.

Can anyone recommend a broker who they have had positive experiences with in the past? As i said, post 2004/pre 2013 so thankfully on old pay scale. Goal is to retire at 60.
 

Dave Vanian

Registered User
Messages
734
They have invented a charging structure to confuse. I say walk away.

Okay in the interests of fairness, it's not the broker who invented the charging structure. Zurich Life invented a menu of charging structures that brokers can choose from. Some are clearer than others and some pay more commission than others - even for the same product. Evidently this broker has chosen this one from the menu.
 

Steven Barrett

Registered User
Messages
3,859
I'm just not up to speed on the fine print of this particular Zurich Life product
Neither am I and for a reason. Rebate plans are a bad idea. The charges on them are very high and you only get the money back when strict conditions are met...after a very long time. It is in effect, giving you back your own money. As you said in another post, who can say what the next 15 years will be like? You may have to take a break from the AVC's for some reason and suddenly the rebate is gone but you continue to pay high fees.
Hi folks, thanks very much for your responses, it’s really appreciated and exactly the type of scrutiny that is perhaps needed. Seems overly complicated and too many questions attached to it, and when that is the case, more often than not it is the customer who loses out if the terms are suitably vague.

Can anyone recommend a broker who they have had positive experiences with in the past? As i said, post 2004/pre 2013 so thankfully on old pay scale. Goal is to retire at 60.
Go to one of the online brokers and set up a PRSA AVC with 100% allocation and 1% amc. Or else ask someone to do it for a fee if you want help with putting it in place. Otherwise, you'll have a lot of 4% taken off your contributions between now and retirement.


Steven
www.bluewaterfp.ie
 

chases0102

Registered User
Messages
15
Before I get back to the broker today, I have a breakdown of the option of charges here, just to see what ye think.

Either - Contribution charge of 3.5%, and a Management Charge of 1%

OR (and this is what was recommended for me)

Contribution Charge 5% (<500 4.25%)
Management Charge 1.75%

Management Charge refunded at retirement if 1. 15 years to retirement, 2. €300 per annum, 3. Selected Retirement Age
According to the broker, this works out essentially as Contribution Charge 0%, and Management Charge 1%


Would ye still be reluctant to go ahead with this? Too expensive if criteria not adhered to? Too inflexible?
 

GSheehy

Registered User
Messages
450
The Rebate Plan is an absolute punt by you, against the actuaries.

They have all the historical information on the likelihood of you fullfilling the conditions and the probability of you doing that, whilst not impossible, is heavily weighted against you.

It's the hightest paying PRSA commission contract on the market, as far as I'm aware. The only reason that anyone could recommend/justify this is that the quote on estimated value at maturity will be higher than other charging structures.

Someone 45 next birthday (17/05/1977) paying €500pm to 65 on a 5% / 1% would have an estimated fund of €171,442 at maturity (€170,519 in yr 21). For the 5% / 1.75% Rebate it's €183,898 at maturity (€156,362 in yr 21). So, you also lose on death before maturity. The equivalent quote figures for a 0% / 1% contract are €179,052 (€178,088)

If you want to add a single premiums to the Rebate, it's 95% allocation and 1.75% AMC - these SP 1.75%'s aren't rebated at maturity.

Gerard

www.prsa.ie
 

chases0102

Registered User
Messages
15
Many thanks for that - when you put it like that, it is not attractive. Surely a more equitable product for what I am looking for out there.
 

chases0102

Registered User
Messages
15
Hi all, I sought out other advice and form another broker was offered an AVC with 100% allocation, 1.5% management fee, with no set up/consultation fee, a "tailored and personal strategy" and with step by step advice on how to set up the tax credits.

Does this sound like a good deal? It's a Zurich PRSA.
 

GSheehy

Registered User
Messages
450
100% Allocation and a 1.5% AMC (say, over 20 years like the example above) is worse value for you than 95% Allocation and 1% AMC over same period. To the (estimated) tune of about €2,500


Gerard

www.prsa.ie
 

chases0102

Registered User
Messages
15
OK thanks for that Gerard.

It seems everywhere I go I am getting poor value? Am I missing something?
 

chases0102

Registered User
Messages
15
I think I'd be happier with the bit of advice, every now and then - I wouldn't be the most astute when it comes to tax compliance or opportunities to make the most of my contributions. A little bit of hand holding, as it were.

I initially came to the site re the Rebate scheme from Zurich and received strong, sensible advice to stay away - I presume the latter suggestion of 100% allocation, 1.5% AMC is the the better option for what I'm looking for?

Many thanks for the inputs.
 

Protocol

Registered User
Messages
3,381
The income tax claim part is simple, no need to ask anybody or pay anybody.

Picking funds - well one suggestion is if you have a long period until drawdown at retirement, then simply hold a worldwide equity passive tracker.
 

GSheehy

Registered User
Messages
450
It seems everywhere I go I am getting poor value? Am I missing something?

No.

It's not that you're getting poor advice. It's more a case of, if you need advice then you're going to have to pay for it. Either by a contribution charge, a higher AMC, or pay someone a fee 'every now and then', when/if you need advice.


Gerard

www.prsa.ie
 

k06351000

Registered User
Messages
55
The income tax claim part is simple, no need to ask anybody or pay anybody.

Picking funds - well one suggestion is if you have a long period until drawdown at retirement, then simply hold a worldwide equity passive tracker.

Is there a worldwide equity passive tracker available with Zurich through labrokers? I don’t think so.

This is the closest I could find and it clearly states it’s a managed fund.

zurichlife.ie/DocArchive/servlet/DocArchServlet?docId=SI_ID_FF&docTag

This is the full list available, I think they are all actively managed

labrokers.ie/wp-content/uploads/2019/04/Standard-PRSA-AVC-Funds-2019.pdf

(I couldn’t add proper links for some reason but theses should work if you copy and paste.)
 
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